Slice has acquired a 5% stake in Indian bank North East Small Finance. This is an important step in the journey of unicorn fintech startups, analysts say, amid mounting challenges from central banks that have overthrown many young firms.
The Bengaluru-based start-up invested $3.42 million in September in a 5% stake in a Guwahati-based microfinance bank, regulatory filings show.
The investment comes at a time when the Reserve Bank of India has clipped the wings of many fintech startups operating in the cards and lending space by requiring strict compliance with strict new guidelines.
A bank investment is certainly a rare and ostensibly important milestone for a startup, but it’s a $1.55 billion startup that counts Tiger Global, Insight Partners, Blume Ventures and Axis Bank as backers. It’s unclear how soon it will be profitable for Slice.
The company did not respond to a request for comment.
The world’s second most populous country is at an interesting time as banks and fintech start-ups look for ways to improve engagement. Federal Bank and SBM Bank India have acquired a number of start-up clients over the last few years in an attempt to strengthen their business.
Slow-growing banks such as HDFC and ICICI are also expanding talks with younger banks. HDFC, India’s largest private bank, recently backed Mintoak, a SaaS platform that provides merchant services in India and other markets.
SBM Bank’s India arm began engaging with investors late last year to raise capital, pitching its vision of becoming India’s top banking-as-a-service provider, TechCrunch previously reported. Accel and Quona backed Shivalik Small Finance Bank last year.
But South Asian markets have seen a surge in predatory China-related lending apps in recent years, prompting the central bank to introduce rules that will have far-reaching implications for many businesses, including those not involved in the wrongdoing. are forced to Business practices of faith.
North East Small Finance Bank, established in 2016, is a subsidiary of RGVN (NE) Microfinance, serving clients in the northeast region of the country. Backed by Pi Ventures, SIDBI Venture Capital and Bajaj Group.
